Practicing Success
Yogesh started his business of processed food items. Being the sole proprietor of business, he used to take all the decisions. When his business grew, he continued with the old practice of controlling all by himself. It led to delay in all important decisions. |
Unity of direction Authority and responsibility Centralization and decentralization Unity of command |
Centralization and decentralization |
Centralization refers to concentration of decision-making authority, whereas decentralization refers to evenly distribution of authority at all levels of management. According to Fayol, “There is a need to balance subordinate involvement through decentralisation with managers’ retention of final authority through centralisation.” The degree of centralisation will depend upon the circumstances in which the company is working. In general large organisations have more decentralisation than small organisations. |